RNS Number:4981S
Countryside Properties PLC
26 November 2003
26th November 2003
COUNTRYSIDE PROPERTIES PLC
("Countryside Properties" or "the Group")
Preliminary Results for the year ended 30th September
2003
Countryside Properties PLC, the specialist developer of
sustainable communities, announces Preliminary Results
for the year ended 30th September 2003.
* Pre-tax profit in line with expectations, 5% up at a
record #36.1m (2002 - #34.3m), on turnover 8% lower at
#418.6m (2002 - #456.1m).
* Operating margins from the Group's development
activities improved to 13.4% (2002 - 11.0%).
* Earnings per share increased by 6% to 33.6p per
share (2002 - 31.6p).
* Total dividend increased by 11% to 7.75p per share
(2002 - 7.0p).
* These results were achieved in generally quieter
conditions in the Group's principal markets than in
recent years
- As widely reported, housing markets in parts of
London and the South East, particularly for higher
priced homes, experienced a slow down during the
year.
- Trading in the North West, which enjoyed much
better market conditions, was good.
* The land market continues to be strong and land
sales during the year of #69.0m (2002 - #59.8m) again
made a good contribution to results. Land sales play an
integral role in optimising Group returns and balancing
its risk profile.
* The Group maintains one of the strongest
landholdings in the housebuilding sector; year end
landholdings with planning permission, at 5,400 plots
(2002 - 4,900 plots) were the highest they have ever
been. In addition the Group has an extensive strategic
landbank.
Much of the land in the Group's control is located
in the Thames Gateway area and the M11 corridor,
which are both areas identified by Government for
significant growth and in which Countryside
Properties is one of the largest developers.
* The Group's prospects remain excellent.
Alan Cherry, Chairman, commented:
"Countryside Properties is an established developer
specialising in the creation of sustainable communities
and in urban and rural regeneration. Our primary
objective is to optimise returns from our substantial
land portfolio and skills base, enabling us to
consistently deliver growth in earnings per share in
varying market conditions.
"The Board is confident that the current year will show
improved results and further progress for the Group, with
results as last year particularly weighted towards the
second half. Current trading across the Group is in line
with the Board's expectations.
"Countryside Properties' longer term prospects remain
excellent. Our skills base and experience as a
specialist developer, coupled with our outstanding land
bank in the areas identified by the Government for
significant growth, securely positions the Group to take
advantage of the exciting opportunities that lie ahead."
- ends -
For further information, please contact:
Countryside Properties PLC on 26/11/2003: 020 7067 0700
Graham Cherry, Chief Executive thereafter on: 01277 260000
Wendy Colgrave, Finance Director
Weber Shandwick Square Mile 020 7067 0700
Nick Oborne / Louise Robson / Sally Lewis
26th November 2003
COUNTRYSIDE PROPERTIES PLC
("Countryside Properties" or "The Group")
Preliminary Results for the year ended 30th September
2003
Countryside Properties is an established developer
specialising in the creation of sustainable communities
and in urban and rural regeneration. Our primary
objective is to optimise returns from our substantial
land portfolio and skills base, enabling us to
consistently deliver growth in earnings per share in
varying market conditions.
Results
I am pleased to report that, in generally quieter market
conditions than we have experienced in recent years, the
Group achieved another year of record profit. Profit
before tax increased 5% to #36.1m (2002 - #34.3m) on
turnover 8% lower at #418.6m (2002 - #456.1m).
Earnings per share increased 6% to 33.6p per share (2002
- 31.6p).
Shareholders' funds increased by 15% to #151.9m (2002 -
#131.9m), equating to net asset value per share of 192p
(2002 - 168p). Bank loans and overdrafts ended the year
at #93.3m (2002 - #74.4m), representing gearing of 61%
(2002 - 56%).
Return on shareholders' funds was 25.4% (2002 - 28.0%)
and return on total capital employed 18.2% (2002 -
20.8%). These movements reflect increased investment in
land holdings and work in progress, which underpins the
future growth and prosperity of the Group.
Dividend
In the light of these results and our confidence in the
Group's prospects, the Board is recommending a final
dividend of 5.13p per share (2002 - 4.62p) which,
together with the interim dividend of 2.62p per share,
amounts to a total dividend for the year of 7.75p per
share - an increase of 11% over the 7.0p per share paid
in the previous year. The total dividend proposed for
the year will be covered 4.3 times by earnings (2002 -
4.5 times).
It is proposed that the final dividend be paid to
shareholders on 8th April 2004 in respect of shares
registered in their names at the close of business on
19th March 2004.
Trading Analysis
The results for the year, in line with expectations,
reflect the benefits the Group enjoys from its broad
range of development skills and expertise and the
assembly and promotion of its excellent landbank.
Development Activities
Turnover from all of our development activities totalled
#307.8m (2002 - #358.7m).
As widely reported, housing markets in parts of London
and the South East, where selling prices for more
expensive houses have fallen, experienced a slow down
during the year. This, coupled with building delays on a
small number of projects, resulted in fewer sales
completions than anticipated. Trading in the North West,
which enjoyed much better market conditions, was good.
During the year the Group completed the sale of 812 new
homes (2002 - 986), including its share of a total of
312 new homes (2002 - 123) sold on behalf of joint
ventures. Turnover from private housebuilding totalled
#222.2m (2002 - #268.2m). The average selling price of
all new homes sold was #288,000 (2002 - #279,000).
Commercial property transactions during the year
generated turnover of #16.6m (2002 - #30.7m). Most of
this activity comprised the commercial content of large
mixed use projects.
The land market continues to be strong and land sales
during the year of #69.0m (2002 - #59.8m) again made a
good contribution to results. With our proven ability to
acquire and successfully promote land through the
planning process, and to subsequently add material value
to land as part of our development approach, land sales
will continue to play an integral role in optimising
returns and balancing our risk profile. Land sales are
usually made to other developers seeking opportunities
otherwise unavailable to them and to our joint ventures.
Irrespective of land sales, our year end land holdings
with planning permission were the highest they have ever
been.
Operating profits from all the Group's development
activities rose to #41.1m (2002 - #39.4m). Operating
margins improved to 13.4% as compared to 11.0% last year,
reflecting the mix of business completed during the
period. While we expect margins to remain broadly
similar in the current year, we are confident that higher
levels of activity, continued focus on reducing our cost
and overhead base, increased use of experienced third
party main contractors on fixed price agreements and our
decision in 2001 to raise hurdle rates on land
acquisition will result in enhanced margins in the
future.
Design and Build Contracting
Turnover from our Design and Build contracting operations
totalled #110.8m (2002 - #97.4m) with 941 new homes (2002
- 807) being completed for housing associations and
others. Operating profits from this activity rose to
#3.3m (2002 - #2.6m) with operating margins improving to
2.9% (2002 - 2.7%).
With our leading position in this field we continue to be
well placed to take advantage of the considerable
opportunities now presenting themselves as the Government
seeks to increase the supply of affordable housing and
encourages the expansion of estate renewal programmes.
Our design and build activities are a very important part
of the Group's integrated approach to mixed-use and mixed-
tenure development. We have a unique place in this
market which gives the Group significant advantages in
securing new development opportunities.
The current order book for this work totals #243m (2002 -
#136m) of committed contracts, with a further #283m (2002
- #232m) agreed subject to contract, which will enable us
to increase output and profitability from this activity
over the next few years.
The Market
While the housing markets in our areas of operation have
shown some improvement in recent months they remain
generally slow in London and the South East, particularly
for higher priced homes. The market is stronger at prices
below #300,000.
Demand from occupiers for commercial property remains
subdued. We foresaw these conditions and the Group's
exposure to this market is limited.
The Group has during the last three months experienced a
similar level of enquiries to those received during the
comparable period a year ago, and sales reservations are
up 6%. Forward sales of the Group's new homes by value
are currently in line with this time last year. It is too
early to gauge the impact of the recent rise in interest
rates, but to date we have seen little impact on home-
buyers' confidence.
We remain confident that the long term outlook for the
housing market is very positive. Underlying demand for
new homes, particularly in London and the South-East, is
set to outstrip supply for many years to come, with a
consequent need to increase the number of new homes
built.
Joint Ventures
Joint ventures are an important part of our operational
profile, allowing the Group to participate in large,
capital intensive projects, which increases overall Group
returns while maintaining a balanced risk exposure.
In addition to our joint ventures with English
Partnerships, the South East of England Development
Agency, Taylor Woodrow, British Land, GE Real Estate,
Liberty Property Trust and Citigroup Alternative
Investments, the Group has recently entered into joint
ventures with Quintain Estates and Apollo International
Real Estate Fund.
The joint venture with Quintain is to develop a prominent
9.4 acre brownfield site in Colliers Wood, London. This
major new mixed-use development will include 2 and 3
bedroom apartments, a hotel pre-let to Scottish &
Newcastle (Premier Lodge), a large health and fitness
centre and two restaurants. Construction work has
already started and the development is expected to be
completed in Summer 2006.
The joint venture with Apollo is to undertake the
development of a new residential development in Central
Cambridge. The 24-acre site is located close to the
Cambridge University Botanical Gardens. The project will
comprise 378 new houses and apartments, including 114
affordable homes for rent and shared ownership.
Construction has already commenced, with completion
expected early 2007.
Land Holdings
Our leading reputation and proven abilities in the
development of sustainable, large scale mixed use and
mixed tenure projects, in line with Government criteria
gives us a strong competitive advantage in securing
opportunities to generate profitable growth and underpin
our future. As a result we are able to bring forward a
steady flow of major projects, which currently include
developments in London, Liverpool, Manchester, Croydon,
Guildford, Maidstone and Chelmsford, all major
conurbations or leading regional centres.
We maintain a substantial land bank either owned or
controlled, through options and conditional contracts,
with the potential for some 22,000 (2002 - 22,700) new
homes including 5,400 (2002 - 4,900) with planning
permission, and 16,600 (2002 - 17,800) subject to
planning permission. A number of these sites are for
mixed-use development with the potential for commercial,
retail, leisure and community uses, as well as new
housing. Our land stocks include potential for nearly 1.5
million sq ft of accommodation for commercial and
community uses.
Much of the land in the Group's control is located in the
Thames Gateway area and the M11 corridor, which are both
areas identified by the Government for significant
growth. Countryside Properties is one of the largest
developers in both of these regions.
Prospects
The Board is confident that the current year will show
improved results and further progress for the Group, with
results as last year particularly weighted towards the
second half. Current trading across the Group is in line
with the Board's expectations.
Countryside Properties' longer term prospects remain
excellent. Our skills base and experience as a
specialist developer, coupled with our outstanding land
bank in the areas identified by the Government for
significant growth, securely positions the Group to take
advantage of the exciting opportunities that lie ahead.
ALAN CHERRY CBE DL
Chairman
25th November 2003
For further information, please contact:
Countryside Properties PLC on 26/11/2003: 020 7067 0700
Graham Cherry, Chief Executive thereafter on: 01277 260000
Wendy Colgrave, Finance Director
Weber Shandwick Square Mile 020 7067 0700
Nick Oborne / Louise Robson / Sally Lewis
Countryside Properties PLC
Consolidated Profit and Loss Account
For the year ended 30 September 2003
2003 2002
#'000 #'000
--------------------------------------------------------------------
Turnover: Group and share of joint ventures 418,629 456,081
less share of joint ventures' turnover (32,515) (18,317)
--------------------------------------------------------------------
Group turnover 386,114 437,764
Cost of sales (316,129) (368,060)
--------------------------------------------------------------------
Gross profit 69,985 69,704
Administrative expenses (30,600) (30,789)
--------------------------------------------------------------------
Group operating profit 39,385 38,915
Share of operating profit of joint ventures 4,986 3,100
--------------------------------------------------------------------
Operating profit including share of
joint ventures 44,371 42,015
Interest payable (net) (8,315) (7,702)
--------------------------------------------------------------------
Profit on ordinary activities
before taxation 36,056 34,313
Taxation (10,942) (10,538)
--------------------------------------------------------------------
Profit on ordinary activities after
taxation 25,114 23,775
Dividends (5,805) (5,223)
--------------------------------------------------------------------
Retained profit for the financial
year 19,309 18,552
====================================================================
Earnings per 25p share 33.6p 31.6p
Diluted earnings per 25p share 31.8p 30.1p
====================================================================
There are no recognised gains or losses for the year
other than those shown in the Profit and Loss Account
above.
Countryside Properties PLC
Consolidated Balance Sheet
As at 30 September 2003
2003 2002
#'000 #'000 #'000 #'000
----------------------------------------------------------------------------------------
Fixed assets
Tangible assets 3,922 4,590
Investments
Investments in joint ventures
Share of gross assets 102,017 69,658
Share of gross liabilities
- borrowings (29,137) (5,672)
- other creditors 1 year (10,394) (2,331)
----------------------------------------------------------------------------------------
7,918 5,477
Other investments 475 562
8,393 6,039
----------------------------------------------------------------------------------------
12,315 10,629
Current assets
Stocks 319,778 267,824
Debtors 99,189 73,315
Cash at bank and in hand 18 18
----------------------------------------------------------------------------------------
418,985 341,157
Current liabilities
Creditors: due within one year (261,162) (194,109)
----------------------------------------------------------------------------------------
Net current assets 157,823 147,048
----------------------------------------------------------------------------------------
Total assets less current liabilities 170,138 157,677
Creditors: due after more than one year (18,263) (25,800)
----------------------------------------------------------------------------------------
151,875 131,877
========================================================================================
Capital and reserves
Called up share capital 19,773 19,633
Reserves
Share premium account 29,833 29,284
Capital reserves 56 56
Profit and loss account 102,213 82,904
----------------------------------------------------------------------------------------
Total equity shareholders' funds 151,875 131,877
========================================================================================
Countryside Properties PLC
Analysis by Activity
2003 2002
#'000 #'000 #'000 #'000
----------------------------------------------------------------------------------
Turnover
Development
- Group 275,291 340,346
- Share of Joint Ventures 32,515 18,317
----------------------------------------------------------------------------------
307,806 358,663
Design & Build Contracting
- Group 110,823 97,418
- Share of Joint Ventures - -
----------------------------------------------------------------------------------
110,823 97,418
----------------------------------------------------------------------------------
418,629 456,081
----------------------------------------------------------------------------------
Operating profit
Development
- Group 36,146 36,276
- Share of Joint Ventures 4,986 3,100
----------------------------------------------------------------------------------
41,132 39,376
Design & Build Contracting
- Group 3,239 2,639
- Share of Joint Ventures - -
----------------------------------------------------------------------------------
3,239 2,639
----------------------------------------------------------------------------------
44,371 42,015
----------------------------------------------------------------------------------
Note
The preliminary announcement is an excerpt from the audited accounts
dated 25th November 2003 and does not constitute the statutory
financial statements of the Group. The auditors' report thereon
was unqualified. The accounts are expected to be issued
to shareholders in January 2004 and will be filed with
the Registrar of Companies. Comparative figures for the
year ended 30th September 2002 are taken from the Group's
published accounts for the year then ended, which have
been delivered to the Registrar of Companies. The report
of the auditors on those accounts was unqualified.
Countryside Properties PLC
Summarised Consolidated Cash Flow Statement
For the year ended 30 September 2003
2003 2002
#'000 #'000 #'000 #'000
----------------------------------------------------------------------------------------
Net cash inflow from operating activities 2,056 41,032
Dividends received from joint ventures 1,111 641
Returns on investments and servicing of finance
Interest paid to finance development activities (7,225) (7,210)
Taxation
UK corporation tax paid (9,190) (9,701)
Capital expenditure and financial investment
Purchase of tangible fixed assets (666) (955)
Sale of tangible fixed assets - 49
Advances to joint ventures(net) (805) (14,761)
Equity share scheme loans repaid 87 56
----------------------------------------------------------------------------------------
(1,384) (15,611)
Acquisitions and disposals
Repayment of/(Investment in) share capital
of joint ventures 495 (2,390)
Equity dividends paid (5,414) (4,899)
----------------------------------------------------------------------------------------
Net cash (outflow)/inflow before financing (19,551) 1,862
Financing
Issue of Ordinary share capital 689 -
----------------------------------------------------------------------------------------
(Decrease)/Increase in cash (18,862) 1,862
========================================================================================
Reconciliation of operating profit
to net cash inflow from operating activities 2003 2002
#'000 #'000
----------------------------------------------------------------------------------------
Group operating profit 39,385 38,915
Depreciation 1,334 1,290
(Profit) on fixed asset disposals - (15)
Write down of investment in joint venture - 1,968
(Increase)/Decrease in stock (51,954) 21,899
(Increase) in debtors (25,190) (10,706)
Increase/(Decrease) in creditors 38,481 (12,319)
----------------------------------------------------------------------------------------
Net cash inflow from operating activities 2,056 41,032
----------------------------------------------------------------------------------------
This information is provided by RNS
The company news service from the London Stock Exchange
END
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